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How Do I Choose the Right Home Insurance Deductible?

Maximize your home insurance by choosing the best deductible for you!

Deciding on your home insurance deductible can be a stressful balancing act.  Before starting the process, learn what a deductible is and how it affects you.

In plain words, a deductible is the amount of money you agree to pay out-of-pocket before your home insurance kicks in.  For example, if you have a deductible of $100 and you make a claim for $300, your insurance company will pay $200.

Many insurance companies have a minimum deductible that you must assume.  However, they also offer you the opportunity to balance your deductible against your premium.  This means that the higher deductible that you agree to pay, the lower your annual premium will be.  While increasing your home insurance deductible is a common money-saving strategy, it’s important to know the risks this decision entails.  Many homeowners agree to pay a higher deductible to save money on their premium only to find that they can’t pay their deductible when disaster strikes.  Agreeing to pay a higher deductible than you can afford means you might not receive coverage when you need it.

On the flip side, many homeowners decide on a lower deductible to ensure that they can afford coverage when they need it.  However, if these homeowners consistently avoid filing a claim, they might find themselves losing money by paying their high premium costs.

Ultimately, when choosing the right deductible for you, it’s important to look at your finances and determine what you can afford to pay comfortably.  Please remember that how your deductible affects your premium differs depending on state and local regulations.  Your individual insurance company will also affect the balance between your deductible and premium.

Use this information to choose the best home insurance deductible for you.  Be sure to contact the knowledgeable team at Pierce Insurance Group for all your insurance needs.